In 2017-18 China dramatically changed the structure of the Pacific seaborne cement trade by moving almost overnight from the world’s largest exporter of cement to its largest importer, as demand from coastal cities in China accelerated at a time when China was endeavoring to close down some of their older cement kilns. Thus, Chinese imports which were less than a million metric tons in 2017 skyrocketed to a massive 37 MMT by 2020 and were still 31.3 MMT in 2021.

Most of these shipments were in the form of cement clinker with Vietnam the main supplier to China with shipments rising from 0.1 MMT in 2017 to nearly 20 MMT last year. China as a destination also dominated the cement export markets of Japan (2.7 MMT in 2020) South Korea, (1.9 MMT in2019), Indonesia (2.7 MMT in 2020) and Thailand (2.5 MMT in 2020).

Bangladesh, previously the largest importer of cement in the Pacific with 16.5 MMT in 2018 rising to nearly 23 MMT last year suddenly had to look elsewhere from Vietnam as its principal supplier; consequently, the UAE stepped up to provide 6 MMT clinker last year (from less than 1 MMT in 2018) as well as significant contributions from Indonesia (5 MMT), Thailand (4 MMT), Pakistan (2.6 MMT) with Iran (1.7 MMT), a completely new supplier.

This dramatic change in cement trading patterns had significantly impacted the Indian Ocean supramax sector which has become the premium ocean due to additional tonnage being repositioned out of South East Asia to China whilst the strong Arabian Gulf (AG) cement clinker-aggregates-gypsum trade to the Bay of Bengal has often led to a shortage of tonnage in the AG.

Against this backdrop, China’s decision in May to virtually halt all cement imports has the potential to once again significantly change these trading patterns. This move is indicative of a wider malaise in the Chinese construction industry; annual cement consumption which reached a peak 2.4 BMT In 2020 and 2021 has fallen sharply in recent months with consumption down a massive 228 MMT (-11%) year on year in the ten months to October.

As yet China has not resumed exporting cement but clearly there will be a shake up in the Indian Ocean and South East cement clinker trades in 2023.